Question
Shamrock Motors is a division of Shamrock Products Corporation. The division manufactures and sells an electric switch used in a wide variety of applications.
Shamrock Motors is a division of Shamrock Products Corporation. The division manufactures and sells an electric switch used in a wide variety of applications. During the coming year, it expects to sell 220,000 units for $8.00 per unit. Kimberly Young is the division manager. She is considering producing either 220,000 or 270,000 units during the period. Other information is as follows: Division Information for 2022 Beginning inventory Expected sales in units Selling price per unit Variable manufacturing cost per unit Fixed manufacturing cost (total) Fixed manufacturing overhead costs per unit Based on 220,000 units 0 220,000 $8.00 $2.70 $594,000 Based on 270,000 units Manufacturing cost per unit Based on 220,000 units Based on 270,000 units $2.70 per unit ($594,000+220,000) $2.20 per unit ($594,000+270,000) $5.40 per unit ($2.70 variable + $2.70 fixed) $4.90 per unit ($2.70 variable + $2.20 fixed) $0.50 per unit Variable selling and administrative expenses Fixed selling and administrative expenses (total) $11,900 (a) Prepare an absorption-costing income statement, with one column showing the results if 220,000 units are produced and one column showing the results if 270,000 units are produced. SHAMROCKMOTORS DIVISION Income Statement For the Year Ended 2022
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